Pre-deposit of penalty cannot block an appeal where duty is paid and a prima facie case exists.

Insisting on pre-deposit of the remaining penalty amount as a condition for admitting an appeal was treated as unjustified where the differential duty had already been paid, a prima facie case existed, and there was no material doubt about the assessee's ability to pay. The matter should not be obstructed by technical conditions that prevent a hearing on merits. The writ petition succeeded, the impugned order was set aside, and the assessee's appeal was restored for adjudication on merits in accordance with law.

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Issues: Whether the Tribunal was justified in insisting on deposit of the penalty amount as a condition for admitting and hearing the assessee's appeal on merits.

Analysis: The differential duty had already been paid, the only amount remaining was the penalty, and the Tribunal itself had found that a prima facie case existed. In those circumstances, and in the absence of any apprehension regarding the assessee's capacity to pay, insistence on prior deposit of the penalty amount was treated as an undue emphasis on technicality rather than a fair condition for hearing the appeal.

Conclusion: The condition requiring deposit of the penalty amount was held unjustified, and the appeal was directed to be admitted and heard on its own merits and in accordance with law.

Final Conclusion: The writ petition succeeded, the impugned order was set aside, and the assessee's appeal before the Tribunal was restored for adjudication on merits.

Ratio Decidendi: Where a prima facie case exists and the substantive duty demand has already been paid, insistence on pre-deposit of the remaining penalty amount as a precondition to admission of the appeal is unjustified if it operates as a mere technical impediment to hearing the matter on merits.

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